In the past few years, the word entrepreneurship has become a buzzword rivaling others like synergy or globalization. Emerging from a slumping economy, our country’s best and brightest thinkers have gotten the itch to start their own businesses.
According to DocStoc, there are over 28 million small businesses in America as of 2013. In that same report, an estimated 543,000 new small businesses get started each month. Additionally, over half of the working population now works for small businesses.
With all of this innovation, its easy to get caught up in the excitement of the brilliant new ideas and creative solutions produced by the flux of these startups. But what about the people behind the businesses? Who are the folks that are bringing these ideas to the market and what are their stories? What collaborations and coalitions among individuals make entrepreneurship possible?
The answers to these questions might be easily brushed aside by the outside observer, concerned more about the bottom line than leadership and team dynamics. But anyone who has started their own business likely sees things differently. Indeed, the vault of quotes from top business execs and CEOs about how companies are only as good as their people is vast and exhaustive. If its true that the people who make up businesses are the magic, why is it that many of these companies leave their employees feeling like they can’t be their authentic selves?
A study conducted by the Center for Talent Innovation shows that many people of color say they need to, “compromise their authenticity” in order to fit in at their company. Andres Tapia, author of The Inclusion Paradox, notes that companies have done a great job of achieving compositional diversity within their organizations but struggle when it comes to developing a “corporate culture where all employees feel included, respected, comfortable, and able to do their best work.”
Who we are matters and in order to reach our potential in business we have to embrace conversations about identity to best serve ourselves, the people we work with, and our clients.
Here are eight reasons why who you are affects your business:
1. You are your product. No matter how innovative or earth-shattering your idea is, people won’t care to listen to it if they don’t know your story. The best sales people don’t sell products, they sell themselves. The life experiences you’ve had significantly impact your product and the way you run your business. If clients know the person behind the idea, they will have a more profound understanding of why the idea is important and why they should invest in it.
2. The more you understand yourself, the more effective you’ll be. On performance reviews it is often referred to as self-awareness. Those who have a developed understanding of their own strengths, areas for growth, vulnerabilities, and insecurities are better able to navigate challenges and be effective through adversity. Taking some time to explore your own identity as an entrepreneur will help you to better understand your business and your product. It will also allow you to more authentically and confidently communicate your ideas to potential clients.
3. The business world isn’t fair. The sad reality is that our society has been set up to benefit some groups of people and marginalize others. Whether it is racial privilege for white folks or gender discrimination toward women, the systemic structures of privilege and oppression affect us all. Regardless of whether your business does anything to change these structures, it is impacted by them. This might mean that men have a better chance of advancing business than women or that people of color will face obstacles that their White counterparts do not experience. A study by the U.S. Department of Commerce indicates that minorities are less likely to get loans, more likely to be denied credit, and pay higher interest rates. The more conscious we are of these inequities that influence business, the more likely we’ll be to navigate them effectively.
4. Your competitors care about identity and diversity. Every industry has niche markets that businesses aim their advertising efforts toward. Market research is one of the most important strategies for a successful startup. Good companies know the different types of people interested in their product and how best to appeal to those demographics. Ignoring these differences and assuming that the market is colorblind could mean that your competitors are getting the leg up in attracting a prime market for your business.
5. The market is more global than ever before. With e-commerce and the flattening of the world, business today is more global than ever before. This means that companies are learning to navigate cultural boundaries, like language, tradition, and custom, in totally new ways. And understanding globalization doesn’t just apply to big international corporations, it affects small startups right here on Main Street. The U.S. is growing increasingly more diverse everyday and successful companies that know how these changes impact their business will thrive.
6. Effective businesses leverage difference. Every good business knows how to utilize its different resources. Each person working in your company brings a vast portfolio of strengths to the table. Not talking about those differences, whether they be specialized training, personality types, or cultural perspectives, means that you have useful skills and talents going to waste. Too often companies focus on diversity in terms of numbers and filling quotas, instead of going a step further and actually capitalizing on the differences among their employees. Different ideas and perspectives only serve to make a product better and more appealing to a broader audience. Smart entrepreneurs seek out feedback and input from diverse perspectives in order to improve their business and see things they couldn’t otherwise.
7. Retaining good people means understanding who they are. Good companies do more than just hire diverse employees, they know how to keep them engaged. Employees who are fully engaged in their companies are 50% more likely to exceed expectations than their non-engaged counterparts. Companies who engage their employees outperform companies who don’t in terms of retention, customer satisfaction, and revenue growth – by a lot! That being said, it makes smart business sense to go the extra mile and provide the resources necessary to keep members of your team engaged in the business. This means taking the time to learn about who they are and what is important to them.
8. Understanding identity and diversity can make or break your image. A company’s success depends largely on the way it is seen by the public. Social media and the internet has significantly impacted the way businesses think about their image, specifically around issues of diversity and discrimination. Incidents of bias that would have flown under the radar a few years ago can cripple a company’s reputation overnight. Companies are being held to a higher standard and this accountability is leading to better businesses that care about issues of diversity and inclusion. Instead of hoping to avoid embarrassing instances of bias, smart entrepreneurs look to understand diversity and the ways it improves their business.